From: Robert Owen (rowen@technologist.com)
Date: Sat Dec 04 1999 - 22:18:02 MST
EvMick@aol.com wrote:
> In a message dated 12/4/99 8:03:11 PM Central Standard Time,
> rowen@technologist.com writes:
>
> > if the
> > "free market" really worked it would be innovative;
>
> It's kinda hard to tell if it will work or not....I know of no example where
> it's been tried. What has been called free was in reality just less
> regulated.
There is an interesting paper on this, CAPITALISM: A TREATISE ON
ECONOMICS by George Reisman. Permit me to quote a bit from it:
"The growing concentration of farmers on producing for the market
and the movement of more and more of their sons and daughters to
the towns and cities to find employment constituted the actual
building of a division-of-labor society. This was a process that was
dictated by considerations of self-interest on the part of millions of
individual people. Each individual farmer who devoted his labor to
producing crops for the market did so because he judged that he
would be better off with the products he could buy with the money
he earned than he would be with the products he could produce for
himself with the same labor...
The security of property made the American people both industrious
and provident, because they knew that they could keep all that they
earned and be able to benefit from all that they saved. (There was
no income tax prior to 1913.) Not surprisingly, they were considered
to be the hardest-working people in the world. And their consequent
high rate of saving ensured that each year a substantial proportion
of their production took the form of new and additional capital goods,
which had the effect of increasing their ability to produce and consume
in succeeding years.
The freedom of production in the United States led to an unprecedented
outpouring of innovations—to the steady introduction of new and pre-
viously unheard of products and to the constant improvement of methods
of production. This, along with the constant availability of an adequate
supply of savings to implement the advances, produced the most rapid
and sustained rate of economic progress in the history of the world. [39]"
But things HAVE changed, and not simply in the proliferation of market
regulations. For example, not only do most consumers fail to save part
of their income, but in fact decrease their income through the interest
charged on their excessive purchasing. A decreasing number of Americans
are genuine investors, and the failure rate of small businesses due to the
devastating purchasing power of corporations is a grievous limitation of
"free enterprise".
You may read this paper at: http://www.capitalism.net/CATOE_01.HTM
Please understand that I am a critic of Capitalism because of its inherent
contradictions and its distributive tendencies with respect to wealth.
But I can appreciate Adam Smith as well as Karl Marx, and I suppose we
must transcend both to reconcile innovation, productivity and prices
with wages and social justice.
----------------------------
[39] In the last generation, Japan, Taiwan, and South Korea have achieved
even more rapid rates of economic progress than the United States did in its
era of greatest progress. But the rapidity of their advance is largely the result
of being able to take advantage of the enormous heritage of innovations
pioneered by and bequeathed to them by the United States.
=======================
Robert M. Owen
Director
The Orion Institute
57 W. Morgan Street
Brevard, NC 28712-3659 USA
=======================
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